Yes, you need a memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each. to set up your companyA private company limited by shares incorporated and registered in England and Wales. . It is referred to in your application and must be in a set form (as to which see Q&A 3).

If your companyA private company limited by shares incorporated and registered in England and Wales. was set up after 1 October 2009, your memorandum will generally have no ongoing relevance for you after your companyA private company limited by shares incorporated and registered in England and Wales. is set up.

Yes.

The form is prescribed by legislationLaws made by the government, usually in the form of Acts of Parliament and regulations. and when you set up your companyA private company limited by shares incorporated and registered in England and Wales. each of your subscribers(In company) The shareholders in a company at the point of incorporation. must sign or authenticate it.

You will find a template memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each. in Template memorandum of association. If you apply online, your memorandum will be generated automatically.

For guidance on applying to set up a companyA private company limited by shares incorporated and registered in England and Wales. , see Setting up a new company, and for everything you are likely to need for the job, see our Starting a company toolkit.

Your memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each. will be automatically generated as part of the online process. You do not need to prepare your own separate memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each..

Your memorandum must be authenticated by each of your subscribers(In company) The shareholders in a company at the point of incorporation. using a personal authentication code.

For further details of how your memorandum will be generated, how you can review the draft version, and how your subscribers(In company) The shareholders in a company at the point of incorporation. can get authentication codes, see Setting up a new company.

As part of submitting the paper application form IN01, you will need to prepare your own memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each..

This is very straightforward. The memorandum must be signed by each of your companyA private company limited by shares incorporated and registered in England and Wales. 's subscribers(In company) The shareholders in a company at the point of incorporation..

For a template memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each. and instructions on how to complete it, see Template memorandum of association.

For guidance on completing and filing the paper IN01 formThe paper application form used when registering a new company with Companies House. to set up a companyA private company limited by shares incorporated and registered in England and Wales. , see Step-by-step guide to incorporation (paper IN01 form).

If you are using a companyA private company limited by shares incorporated and registered in England and Wales. formation agentA person who acts on behalf of another (eg an employee or a solicitor). or solicitor to set up your companyA private company limited by shares incorporated and registered in England and Wales. , they will prepare your memorandum of associationA document which forms part of an application to register a company. It states that the subscribers want to form a company; that they agree to become members; and, if the company is to have a share capital, that the subscribers will take at least one share each. for you.

For guidance on using a companyA private company limited by shares incorporated and registered in England and Wales. formation agentA person who acts on behalf of another (eg an employee or a solicitor). or solicitor to set up a companyA private company limited by shares incorporated and registered in England and Wales. , see Setting up a new company.

Yes and an up to date copy must be filed at Companies HouseThe registrar of all companies in the UK. Companies House incorporates and dissolves limited companies, registers the information companies are legally required to supply, and makes that information available to the public. and be available for public inspection.

No.

You have three options when choosing your companyA private company limited by shares incorporated and registered in England and Wales. 's articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares.:

1. You can adopt what are known as model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. which are a standard set of rules and will apply to your companyA private company limited by shares incorporated and registered in England and Wales. by default. See Q&A 18 for more guidance. If your companyA private company limited by shares incorporated and registered in England and Wales. is a private company limited by sharesA company which is not a public limited company and whose constitution states that the liability of its shareholders is limited to the amount, if any, unpaid on their shares. The vast majority of SMEs will be private companies and not public companies. There are a number of differences between private and public companies, including the ability of a public company, but not a private company, to offer its shares to the public and the requirement for a public company, but not a private company, to have a minimum amount of share capital., a specific set of model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. will apply to your companyA private company limited by shares incorporated and registered in England and Wales. .

2. You can use an amended or modified version of the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company.. If you wish to do this, you have to include a copy of the amended articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. with your application when you set up your companyA private company limited by shares incorporated and registered in England and Wales. (see Setting up a new company).You are recommended to get expert legal advice if you choose this option.

3. You can write your own articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. from scratch. If you choose this option, you must include a copy of the new articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. with your application when you set up your companyA private company limited by shares incorporated and registered in England and Wales. (see Setting up a new company).You are recommended to get expert legal advice here too.

See Q&A 11 as to how to decide which option to choose. If you decide to amend the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. or write your own articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. from scratch, you can use our Ask a Lawyer service to access a specialist lawyer in a few simple steps.

You have three options for articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. to choose from when making your application to set up your companyA private company limited by shares incorporated and registered in England and Wales. :

1. adopt the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company.; or

2. adopt the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. subject to any changes you wish to make; or

3. use entirely bespoke articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares..

See Q&A 10 for more detail on your options. For guidance on applying to set up a companyA private company limited by shares incorporated and registered in England and Wales. , see Setting up a new company, and for everything you are likely to need for the job, see our Starting a company toolkit.

Adopting the model articles of association will be the most straightforward option for your companyA private company limited by shares incorporated and registered in England and Wales. if it is a private company limited by sharesA company which is not a public limited company and whose constitution states that the liability of its shareholders is limited to the amount, if any, unpaid on their shares. The vast majority of SMEs will be private companies and not public companies. There are a number of differences between private and public companies, including the ability of a public company, but not a private company, to offer its shares to the public and the requirement for a public company, but not a private company, to have a minimum amount of share capital.. It is the form adopted by most new SMEsSmall and Medium-sized Enterprises: Businesses which are small or medium sized in terms of their staff numbers, turnover or assets., at least when they are first set up. For a handy summary of what they say, see Quick guide to the model articles. See Q&A 18 and following for what adopting the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. will mean for your companyA private company limited by shares incorporated and registered in England and Wales. .

The chief disadvantage of using the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. in their default form is that they are not tailored to any specific needs your companyA private company limited by shares incorporated and registered in England and Wales. might have, for example in relation to voting rightsRights attached to shares which allow the member to vote on resolutions. Usually shares carry one vote per share but some may have additional voting rights, for example 10 votes per share. For most companies, at meetings of shareholders each member will have one vote per share if voting on a poll but only one vote in total if voting on a show of hands. or dividendsPayments in cash by a company to its shareholders by way of distributions of a share of the company's profits. for particular people. For this reason, you might choose one of the other options although you are strongly recommended to get expert legal advice before doing so. For access to a specialist lawyer in a few simple steps, you can use our Ask a Lawyer service.

Note that even if you adopt the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company., you can amend or replace them at any time provided you follow the correct procedure. See Q&A 12 and Changing a company's articles of association for how to do this.

You can complement your articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. with a shareholders' agreementAn agreement entered into between the shareholders of a company which regulates the relationship between the shareholders and governs how the company is run. which will be binding on those of your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. who sign up to it (see Shareholders' agreement).

Yes, you can amend or even replace your companyA private company limited by shares incorporated and registered in England and Wales. 's articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. at any time by your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. passing a special resolutionA decision made by shareholders of a company, which requires the approval of shareholder(s) holding 75% or more of the company's voting shares..

You might wish to amend your articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. as your business grows and develops, or as part of bringing in third-party investment.

For guidance on changing the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. when bringing in a new shareA share in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. investor, and for template new articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares., see Agreeing terms for a new share investment and Articles of association for shareholders' agreement.

For guidance generally on how to update your companyA private company limited by shares incorporated and registered in England and Wales. 's articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. of association, see Changing a company's articles of association.

Your companyA private company limited by shares incorporated and registered in England and Wales. 's articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. are publicly available on the Companies House public register. They can be found by searching for your companyA private company limited by shares incorporated and registered in England and Wales. 's name and looking at its filing history. Locating your companyA private company limited by shares incorporated and registered in England and Wales. 's current articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. simply involves scrolling through the reverse chronological filing history to find the most recent filing. The articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. are usually accessible in pdf format.

As articles of association The main rules on how a company is run. The articles include rules on the division of powers between directors and shareholders, the composition and operation of the board of directors and how directors’ and shareholders’ meetings are held.are a public document, you should be careful about including confidential or personal information in them, or provisions that apply personally to individual shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company.. Such provisions might be better contained in a separate shareholders' agreementAn agreement entered into between the shareholders of a company which regulates the relationship between the shareholders and governs how the company is run., which complements the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares.. For guidance on when a shareholders' agreementAn agreement entered into between the shareholders of a company which regulates the relationship between the shareholders and governs how the company is run. might be suitable and how best to enter into one, see Shareholders' agreement. Detailed guidance and the accompanying documents can be found in the Shareholders' agreement toolkit.

This depends on what has happened, and how it affects the companyA private company limited by shares incorporated and registered in England and Wales. and its shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company..

In the case of an uncontroversial technical or accidental breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares., where neither the companyA private company limited by shares incorporated and registered in England and Wales. or the shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. are aggrieved, steps can be taken to simply ratify the breachA violation of a legal or moral obligation. or to ensure the correct process is followed.

For more serious or contentious breachesViolations of a legal or moral obligation., your companyA private company limited by shares incorporated and registered in England and Wales. 's shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. or the companyA private company limited by shares incorporated and registered in England and Wales. itself could take legal action to enforce the terms of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares.. See Q&A 15 and following.

Other legal actions can result from a breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares.. For example, a directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. who breachesViolations of a legal or moral obligation. a companyA private company limited by shares incorporated and registered in England and Wales. 's articles of association The main rules on how a company is run. The articles include rules on the division of powers between directors and shareholders, the composition and operation of the board of directors and how directors’ and shareholders’ meetings are held.may also face claims for breachA violation of a legal or moral obligation. of duty and for breachA violation of a legal or moral obligation. of their service agreementIn the context of a company, an agreement between a director or senior manager and the company, outlining the particulars of the services to be provided by the director or manager to the company and what he will receive in return. A director of a company who is also an employee is referred to as an executive director. or letter of appointmentA letter confirming the appointment of an individual to an agreed position, outlining the terms of the appointment and what the individual will receive in return. In the context of a company, a letter of appointment will contain the terms on which a director who is not an employee (also referred to as a non-executive director) is appointed to the board.. If such claims are successful, a directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. could potentially be removed from office and could face personal liability as a result. For further guidance, see Directors' personal liabilities.

Yes.

The action taken will depend on what provisions of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. have been breachedViolation of a legal or moral obligation. . Potential legal claims include:

1. a legal claim by a shareholderIn relation to a company limited by shares, means a person whose name has been entered in the register of members of that company as a shareholder in that company. to declare any decision or action taken in breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. invalid and voidNot legally binding.;

2. a legal claim by a shareholderIn relation to a company limited by shares, means a person whose name has been entered in the register of members of that company as a shareholder in that company. to force others to comply with the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares.; and/or

3. an application by a shareholderIn relation to a company limited by shares, means a person whose name has been entered in the register of members of that company as a shareholder in that company. for a court orderA command made by a court or a judge which requires a person to do or not do something. to stop an ongoing or threatened breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. (an injunctionAn order of the court which usually prevents a person from doing something or requires a person to do something.).

Bringing, or defending, any of these legal actions is complex and will require specialist legal advice. If you are thinking about it, you can access a specialist lawyer in a few simple steps by using our Ask a Lawyer service.

Yes.

The action taken will depend on what provisions of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. have been breachedViolation of a legal or moral obligation. . Potential legal claims include:

1. a legal claim by the companyA private company limited by shares incorporated and registered in England and Wales. to declare any decision or action taken in breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. invalid and voidNot legally binding.;

2. a legal claim by the companyA private company limited by shares incorporated and registered in England and Wales. to force others to comply with the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares.; and/or

3. an application by the companyA private company limited by shares incorporated and registered in England and Wales. for a court orderA command made by a court or a judge which requires a person to do or not do something. to stop an ongoing or threatened breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. (an injunctionAn order of the court which usually prevents a person from doing something or requires a person to do something.).

Bringing, or defending, any of these legal actions is complex and will require specialist legal advice. If you are thinking about it, you can access a specialist lawyer in a few simple steps by using our Ask a Lawyer service.

No.

A directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. who is not a shareholderIn relation to a company limited by shares, means a person whose name has been entered in the register of members of that company as a shareholder in that company. cannot take legal action to deal with a breachA violation of a legal or moral obligation. of the articlesAlso referred to as articles of association, a company’s articles are the main body of rules which govern how the company regulates its internal affairs (subject to certain overriding legal requirements). Important matters addressed in the articles include the division of powers between directors and shareholders, the composition and operation of the board of directors, matters relating to the holding and conduct of directors’ and shareholders’ meetings, and provisions relating to the transfer of shares. as themselves. However, an individual directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. can attempt to force the companyA private company limited by shares incorporated and registered in England and Wales. to do something by convening a board meetingA meeting of a company's directors. and proposing that legal action is taken by the companyA private company limited by shares incorporated and registered in England and Wales. (see Q&A 16).

It will mean that:

1. your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. will run your companyA private company limited by shares incorporated and registered in England and Wales. as they think fit unless the shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. direct them to do or not do something (see Q&A 20);

2. directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. ' decisions will be made at board meetingsMeetings of a company’s directors. or by unanimous written resolutionA procedure allowing private companies to pass a members' resolution without having to hold a general meeting. Copies of the resolution are circulated to each member in hard copy or electronic form, for the members to consider and return their agreement to the resolution if they so decide. (see Q&A 21);

3. new sharesShares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. can be issued by shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. passing an ordinary resolutionA decision made by shareholders of a company, which requires the approval of shareholder(s) holding a majority (eg more than 50%) of the company's voting shares. and your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. have the discretion to refuse to allow a share transferThe process used to transfer legal ownership of shares from one member to another, where the shares are sold or given as a gift. (see Q&A 22);

4. your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. can pay out interim dividendsA dividend paid part way through a company's financial year, based on anticipated profits for that year. If a company has the model articles, its directors will have total authority to decide upon and pay out interim dividends. but final dividendsA dividend paid at the end of a company's financial year based on its actual performance for that year. If the company has the model articles, final dividends must be approved by shareholders following a recommendation by directors. must be declared by your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. (see Q&A 23);

5. shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company.' decisions will be made at general meetingsA meeting of the company's shareholders or members. or by written resolutionA procedure allowing private companies to pass a members' resolution without having to hold a general meeting. Copies of the resolution are circulated to each member in hard copy or electronic form, for the members to consider and return their agreement to the resolution if they so decide. (see Q&A 24); and

6. your board A collective name for the directors of a company. The board is usually the primary day-to-day decision-making body of a company.can approve an indemnityAn agreement that one party will compensate another on the occurrence of a specified event. from your companyA private company limited by shares incorporated and registered in England and Wales. or the taking out of insurance to protect any directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. from personal liability (see Q&A 25).

For a helpful overview of what the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. say, see Quick guide to the model articles.

Under the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company., your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. are given general authority to run your companyA private company limited by shares incorporated and registered in England and Wales. on a day-to-day basis. This means that, unless shareholderIn relation to a company limited by shares, means a person whose name has been entered in the register of members of that company as a shareholder in that company. approval on a matter is legally required or unless your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. require the directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. to act in a certain way, your companyA private company limited by shares incorporated and registered in England and Wales. 's directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. will be responsible for running your companyA private company limited by shares incorporated and registered in England and Wales. .

For more detailed guidance on how your companyA private company limited by shares incorporated and registered in England and Wales. should be run and how it should make decisions, see How a company makes decisions.

Under the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company.:

1. If you have more than one directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. , decisions are made by majority vote at a board meetingA meeting of a company's directors., or unanimously by a written board resolutionA decision of a company's directors, taken by all directors unanimously indicating their agreement in writing to the decision or resolution in question. Most commonly, this is achieved by the circulation and signing of a hard-copy written resolution..

2. A process is set out for board meetingsMeetings of a company’s directors., including quorumThe minimum number of people required to be present in order for a meeting to be valid., chair, dealing with conflicts of interest and recording any decisions made.

3. A directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. cannot take part in any decision about a transaction or arrangement with your companyA private company limited by shares incorporated and registered in England and Wales. if they have an interest in it, unless authorised by your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. (see Directors' conflicts of interest for guidance on this).

4. If there is only one directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. , they can make decisions at their own discretion.

See How to make a board decision for more detailed guidance on how directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. should make decisions.

Under the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company.:

1. New sharesShares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. can be issued by ordinary resolutionA decision made by shareholders of a company, which requires the approval of shareholder(s) holding a majority (eg more than 50%) of the company's voting shares. of your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company.. See Issuing new shares for more detailed guidance on how to issue new sharesShares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. .

2. DirectorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. have a right to refuse to permit the transfer of any sharesShares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. at their discretion. See Transferring shares for guidance on how to transfer sharesShares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. .

Under the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company.:

1. No dividendA payment in cash by a company to its shareholders by way of a distribution of a share of the company's profits. can be declared or paid unless recommended by your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. .

2. Your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. can pay interim dividendsA dividend paid part way through a company's financial year, based on anticipated profits for that year. If a company has the model articles, its directors will have total authority to decide upon and pay out interim dividends. on their own but need approval from shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. before they can pay a final dividendA dividend paid by a company at the end of its financial year based on its actual performance for that year. If the company has the model articles, final dividends must be approved by shareholders following a recommendation by directors. .

See Dividends and other distributions for more detailed guidance on declaring and paying dividendsPayments in cash by a company to its shareholders by way of distributions of a share of the company's profits..

Under the model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company.:

1. Your shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. can make decisions either by voting at a general meetingA meeting of the company's shareholders or members. or by passing a written resolutionA procedure allowing private companies to pass a members' resolution without having to hold a general meeting. Copies of the resolution are circulated to each member in hard copy or electronic form, for the members to consider and return their agreement to the resolution if they so decide..

2. You must comply with specific rules if holding a general meetingsA meeting of the company's shareholders or members., in particular regarding quorumThe minimum number of people required to be present in order for a meeting to be valid., chair, voting, proxies and resolutionsFormal decisions made by the directors or members of a company, which bind the company once passed. (see Shareholders' meetings).

See How to make a shareholders' decision for more detailed guidance on how shareholdersIn relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. should make decisions.

Yes. The model articlesThe standard, default articles of association that a company can use. Articles set the rules that company officers must follow when running the company. permit your board A collective name for the directors of a company. The board is usually the primary day-to-day decision-making body of a company.to compensate or cover any of your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. out of the companyA private company limited by shares incorporated and registered in England and Wales. 's assets against some liabilities they may have incurred whilst acting as directorThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. . The indemnityAn agreement that one party will compensate another on the occurrence of a specified event. cannot cover negligenceFailure to exercise the care that a reasonable person would in the circumstances. Intention is irrelevant. or default or breachA violation of a legal or moral obligation. of duty or trust against your companyA private company limited by shares incorporated and registered in England and Wales. .

Your board A collective name for the directors of a company. The board is usually the primary day-to-day decision-making body of a company.is also permitted to take out insurance, at the cost of your companyA private company limited by shares incorporated and registered in England and Wales. , to protect your directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. if they get sued as a result of carrying out their duties. Insurance can cover more extensive liabilities than an indemnityAn agreement that one party will compensate another on the occurrence of a specified event. from your companyA private company limited by shares incorporated and registered in England and Wales. .

See Protecting directors from personal liability for more detailed guidance on indemnities Agreements where one party agrees to compensate another on the occurrence of a specified event.and insurance for directorsThe directors of a company are the individuals who make up the company's board of directors. Directors may be natural persons or companies, but each company must have at least one director who is a natural person. The board is the main decision-making body of the company. .